Financial Structure


(Caroline Savery) #1

Essentially, it looks like this:

  1. Member dues are gathered. The dues are split (let’s say, e.g., 50/50) into two distinct buckets: Cosmos-Retained and Member-Liquid-Use (Litcoin).

  2. Cosmos-retained: This fund is akin to the organization’s capital reserves. It is only touchable by those authorized to touch it (executive leadership, and/or board, and/or by reaching a critical threshhold of approval by the general membership). Per policies (in Constitutional algorithms), some of these funds are used to cover basic operational expenses (core needs). Some is reserved/saved. Some may be made available (liquidated) to highly-ranked proposals: if the community sufficiently reaches developmental threshholds/criteria on said proposal, Cosmos may create a kind of “matching fund” in response. Effectively, the portion of member dues that is secured in this manner is related to the members’ equity investment in the organization, and, on the basis of their degree of participation, relates back to Cointribute (see below).

  3. Litcoin: This represents the liquid, user-directed “play money” in the system. It originates as dimcoin, meaning the coin only has value when spent on another person or element in the system. Members direct the spending of their own Litcoin through wallets & pay mechanisms (marketplace functionality). There is a wide variety of reasons users can attribute Litcoin to one another. LC represents a measure of what members value in this emergent, peer-to-peer system.

  4. Cointribute (C>) : Because as-much-as-possible value is retained in the Cosmos system, the profits from the inter-activities of members circulates back to members periodically, through the co-op mechanism of patronage. Cointribute (C>) is the format in which Cosmos drips patronage to its members on the basis of their valuable participation. Or, more accurately: Cosmos distributes patronage in the form of LC (which can be redeemed as cash and removed from the platform) AND in the form of C> (which cannot be redeemed or removed from the platform, and functions as a kind of user-choice allocatable “retained earnings”), in a ratio established in the constitution/bylaws (though, per my understanding, at least 20% of patronage equivalence must be distributed as liquid cash (or LC) by law, to cover the tax liability of members).

Whereas co-op businesses typically only recognize financial contributions in their attribution of the profits, aka “excess earnings” back to the members via patronage, Cosmos may have more complex, creative algorithms for how it weighs the value of member contributions (e.g. high-LC-garnering actions may be interpreted as generating more value). C> is more closely tied to trust/influence that LC, and can be spent in special ways that LC cannot. C> may or may not be transferable (delegatable), and functions to influence what kinds of things happen next within the Cosmos system. C> would function similar to the “votes” function described in the Democracy.Earth whitepaper model.

  1. Additional Member Investment & Benefit Opportunities. Cosmos members have a wide range of choices of what they invest their Litcoin, cash, and other forms of capital into on Cosmos (see: Plug-ins & Playbook). Rewards for their “risks” in this way include: increased social cred ratings, more Cointribute, opportunity to profit from the success of the product of their investment later (i.e. royalties), etc. There are also ample opportunities for user-members to “add on” features, tools, utilities, suites of services, or even hiring one another on their projects through additional investments. From these exchanges, Cosmos may glean:

  2. Commissions. A micro-percentage taken from certain types of valuable interactive exchanges taking place on the platform. Calibrated to be more-than-fair to users while covering Cosmos’ maintenance needs beyond its retained capital—esp. wrt research & development costs related to realizing new features and capacities that add value to users.


Governance & Ownership
**Key Docs Table of Contents**